What if my marketing budget doesn't allow me to implement your advice.
This is a quote and a question that the community members, Sean,
who's a marketing strategist.
Wants to sell more advisory services.
Has gone from a prospective client during the proposal stage of one of his projects.
And this is something that's pretty common.
And, uh, and he wants to address it in his FAQ's somewhere.
And I've had this, I've had this before, you know, People, they
tend to want to say, well, how much are things going to cost?
It's not so much that they know their budgets so much as they don't even know.
If they'll be able to sustain your budget in addition to your advice.
And so this is a, there's a lot of things to unpack here.
And, uh, I think at the end of the day, he was looking for what is the pat answer?
What is the thing I could put in my FAQ that would sort
of cover off that question.
And there was some good feedback in there from Orin, you know, basically,
which is kind of echoes my general advice, which is as your advisor,
My job is to give you advice that is aligned with your best interest.
And that includes your financial interest.
All of the I've predetermined that the money you're going to spend on marketing.
Plus my fees are going to net out to a profitable situation for you.
The, the nuance here is whether it's profitable today or
whether it's an investment to the future of your marketing.
So let me unpack that a little bit.
Some clients can sustain me on a cashflow basis.
And they've worked with me since, as long as 2017 in an, as an advisor.
And it's not a problem to pay my fees every month.
And I add a lot of value in the results.
Show show themselves.
Other clients, they see me as more of a short term.
Uh, almost like an operational expense.
To sort of.
Build the systems, the strategies, maybe redesign websites, and ultimately to build
them a lead gen or a marketing engine.
That's going to produce fruit for a long time after I'm gone.
Or they're going through major changes in their business.
Uh, one client I had wanted to get everything really dialed in as they
were negotiating an acquisition ended up getting acquired.
And, uh, my work was able to produce and show and demonstrate that they
had a very provable acquisition model.
Actually, we built that model for them.
And I think that definitely had an impact on the.
The valuation of the company.
And so there's a lot of ways to slice and dice your value.
So the question is whether you're going to be within budget today
or after you're done working in building all these pieces, will it
be within budget over the longterm?
Because sometimes they have to buy, build a new website and that's something you
want to amortize over say five years, because that's approximately how long
it's going to take before you have to think about maybe redesigning it or not.
It's the same with investing in you.
As an advisor.
So ideally you're going to work to stay within their budget.
Let's say they've set five or $10,000 per month aside.
And you're going to take, you know, two to $5,000 to sort of oversee or advise.
Their work.
And then you're going to bring in folks to do the rest.
You're going to be neatly aligned with their budget.
And that's great.
Now, as I mentioned, some clients, especially the smaller clients and
maybe this client is a bit smaller and that's why they were kind of wondering
and asking though, not necessarily.
Sometimes they'll work with me for six or 12 months, and then they know
that that's gone and then now their system is more efficient, more dialed
in and more valuable in the long run.
So.
The question is what, you know, whether it's just about cashflow and
therefore managing your fees within the budget, which case yes, you can
do that as long as it's a reasonable budget and they have reasonable goals.
More importantly though, is what does the ROI equation, what does
the business case look like?
So the bottom line is no matter what, you, you produce a positive
return on investment and you paint a picture of what that would look like.
And you say so inclusive of my fees and execution.
I imagine over the course of the year, you're going to spend 80, 150.
Whatever the price thousand dollars per year.
And by the end of that year, Here are the types of results I expect
you to have based on your size.
This makes sense.
Yada, yada, yada.
And onward and upward you go.
And so I think that's the bottom line is that you work within their budget.
And I hope that sort of clarifies that.
Now you did have a question around.
Around, uh, the business model and whether this is a business model or
pricing tier question, whether to charge a flat fee and advise, and then make
referrals as necessary versus charge and help manage the execution via a
referral network, inclusive of fees.
Uh, and I don't know if this is what you mean, but essentially, and then you ask, I
think, you know, do I choose one of these as a business model and run with it or do
I offer them a separate tiers of service managed advisory versus purely advisory?
I'm thinking the latter and I need to make these options super clear in my
marketing and properly set expectations.
So, um, I would definitely offer them.
I mean, what I currently do is I offer those as different tiers of service.
I've priced the managed advisory services at 10 grand a month.
But really that is just advice.
Plus.
Oversight and management of their marketing.
And so there's kind of some light execution work like proof
of concepts explaining things, overseeing project, managing.
Tasks responsibilities projects.
And then there's advisory, which is less than half the price of that.
So I think I've 9500 3500 for the just pure advisory, 9,500 for the managed
advisory of fractional CMO stuff.
That kind of worked by the way, the fractional CMO managed.
Advisory's a lot of work.
Very disruptive.
It becomes kind of like having a job, so it's okay to get there if
you're just bridging into advisory work, but I wouldn't live there.
So I tend to price that into oblivion as high as I can.
And then, uh, it still works for some clients who have the money, but
otherwise it's, uh, I just focused on the advisory work because it's significantly
easier to manage and do great work.
Um, and then to have time to work on your own business as well.
So, uh, yes, I would make those services very distinct and clear, and it allows
you to push them into the advisory role and thereby having doing the project
management themselves, or you can even bring in and I've, I've been, I found
a few examples of people out there who are digital project managers who can
actually manage projects for your clients.
It's not as effective as if they have someone in house who can do this.
Part-time.
But totally something that they can do.
So, yeah, I would offer, I offer at least three different tiers of service and
I just introduced one on the coaching side, but also on the consulting side,
if you can have a high level of medium and a low, and that allows people
to kind of dive in and at the level, that makes the most sense for them.
And, uh, allows you to have the best of both worlds, get the
results with the lowest overhead.
It just means the client does more work.
And, uh, if they're willing to roll up their sleeves a bit,
they can save the money on the management, significant money.
What I wouldn't do though.
And this may be where I was confused about how you were thinking about doing this.
I wouldn't.
Bake in the cost of execution on top of your fees when you're managing it.
So I wouldn't charge like 15 grand a month and I'll manage it.
Do strategy and cover execution work all within my feet.
I've done that before, when I was first getting started, I think to some level or
no, they, they, they were trying to get me to do that and I just refuse to do it.
And it just mess.
It just kind of creates a bit of a mess.
You basically become an agency and then there's no difference.
Or, or like this behemoth marketing manager agency hybrid.
And you're inseparable from the projects in any way.
It's not good.
So.
I would recommend separating always either you're just advisory
as a standalone thing, and then letting them pay the execution.
The other thing is it's in their interest to have direct relationships
with these people who execute.
Unlike an agency where you're kind of stuck with them for
all this stuff they offer.
By having individual specialists that you bring on board, they get to turn on
or off different specialists as needed.
And have maximum control and also most specialized senior people working on.
Their projects at different price points.
Versus one blended agency who some of it's good and some of it's not.
And you kinda, if, if you have to replace them, then you have to replace your,
basically your entire marketing team.
So that's not ideal for them.
So you want them to have direct access to their suppliers?
I always say if I got hit by the lottery, you'll, you'll have a system process.
Everything you'll own, all the keys will be in your hands and I'll,
you'll be completely good without me.
And I try to, I try to make myself actively redundant every month.
So that's why one of the reasons I separate execution from advice, and that
also includes how the client gets billed.
So even though it might be convenient for you to just invoice everybody
and then subcontract the work.
You might as well just run an agency and call it what it is.
So I hope that helps my friend.
Uh, at the end of the day, your, your, your job is to get,
uh, uh, uh, you know, An ROI.
And whether that ROI happens within the cashflow basis of their budget.
Which to me a budget is a decision.
That's not necessarily a hard and fast rule.
The budget is what is your acquisition costs?
What's your payback period.
Can you sustain that?
Is it profitable to do so?
Uh, so the budget is a decision.
Um, but one of the things I would do is show them.
What the spending versus the results might look like.
And I actually, during sales conversations with, you know, a little more skeptical
or unsure clients, we'll break out.
Here's a scenario where here are my fees laid out over month, over month.
Here's your revenue showing it going up slightly.
And here's the expenses laid out.
Here's how I imagine it'll cost.
And here's how I would manage it for you all within your, your budget and maybe
some months or more sometimes or less.
And then you have to consider.
The big projects, like a website, which again, should be
amortized over, say, five years.
Versus the monthly cost like ads, which are, you know, in that month.
And it should be accrued to that month as well.
So I just try to lay out all the numbers and show them a scenario.
And that's frankly, usually better than trying to prove that you
can work within their budget.
Uh, it also helps if you're a little more specialized and you have experience
working in their industry, because then you can show them benchmarks,
show them examples, show them return on investment for your past clients.
But at the end of the day, as long as you build a business case and have a
credible story as to how you can get the, get that for them, that should help
them with the risk factor because every client, uh, is taking a risk when hiring
you, no matter how good you, you seem.
And they don't know until they work with you.
So.
I hope that answers your questions.
If not, let me know in the comments again, and I'll dig into some more
nuance answer for you, but yeah, as long as they, I sometimes will say,
as long as you have a minimum budget of $10,000 per month, Then I can get
a result for you, although I've done.
Advisory work.
I still do it.
For clients that have less than a $10,000 monthly budget and we do just fine.
So.
It kind of depends, uh, on, on what you're offering and who it's for.
So as long as, you know, you can get a business results or
you're pretty confident, then a.
Then, you know, Position yourself against.
Well, what are your other alternatives?
Do you hire an agency to do everything for you?
Do you hire an in-house marketing manager?
Do you try to do this yourself?
What are the pros and cons of each of those?
Uh, and there are many.
Frankly, I think the advisor model with, with the individual specialists to do the
execution work at different price points for different needs for different clients.
Is the best way.
It's the most effective, most efficient, most convenient, most flexible.
And, uh, tends to get the best results rather than I've done
full service done for you agency.
And then there's all the other challenges that go along with that.
So,
We'll get into that another time.
But the comparison between another value propositions
like employees versus agencies.
But, uh, hopefully this answers your question for now.
The answer is yes, you are the custodian of their budget.
And, uh, you believe you can get them a result if you believe that.
That's all for now have a great weekend thanks for the question sean Bye.